Blockchain technology has been largely seen as one of the most revolutionary pieces of technology, with 2017 being termed as the year of blockchain. This trend continued for the next two years, leading up to 2019 where blockchain technology has found its way into diverse industries and use cases. The three pillars of blockchain, namely, decentralization, cryptography and consensus, make it almost a tamper-proof database which had its origins in cryptocurrency use cases, notably with the introduction of Bitcoin. As more and more industries start to realize the immense potential of blockchain technology, more and more use cases have started emerging throughout the globe.
Why Does The Current System Need Blockchain?
In layman’s terms, blockchain technology acts like a ledger, for fast transactions. It provides the much needed trust, and efficiency in a system used by multiple unknown users. Because of the immense potential of this technology that spreads across to accommodate a variety of transactions, it is now at the forefront of considerations for a host of modern business segments and industrial sector, especially in the financial services industry.
Thus, it can be agreed that blockchain technology has changed our understanding of how to store and transfer data efficiently. However, no transaction or data exchange can take place without the help of mass collaboration as well as a code of the highest quality. This eliminates any insecure third parties from the system, enabling the reliable recording of any kind of information.
The essential aspects of blockchain can be divided into two broad categories, namely Decentralization and Trustability.
- Decentralization: Blockchain technology can provide data storage across a wide user-based network because of the distributed nature of the technology. This allows any two parties in the network to share information without the need of any intermediaries. Data is thus recorded in all the registers simultaneously, making any unauthorized change practically impossible.
- Trustability: Blockchain gets a large part of its reliability and trustfulness from cryptography. All information and transaction are verified with the help of an algorithm, making the data secured and decentralized. Because of this, blockchain provides innovative solutions to the information industry
What 3 Sectors Could Utilize and Benefit The Most From Using Blockchain?
Blockchain has caused many industries to re-evaluate how they do business, especially when the technology sector is concerned. With time, because of the potential for disruption in many industries, blockchain has found its way to a number of sectors, three of which are described below.
- Banking: The current banking and remittance sectors in the world suffer from plaguing issues such as charging participants several transfer fees and other hidden fees. The resulting system is expensive, time consuming, less efficient, and not secure.
Blockchain technology on the other hand, can provide peer to peer payment systems which are highly secured and inexpensive. Under this system, there is no place for a central authority, eliminating the need for payment portals and other third party institutions. This allows for a trustless environment where the user has true autonomy over their transactions.
- Supply Chain Management: By implementing blockchain technology, we can efficiently trace all the steps inside a supply chain system. This makes the transactions permanent, allowing it to be verified easily while increasing transparency. In fact, blockchain technology can be used for verifying any product on the supply chain. For instance, for verifying seafood, the system can efficiently and accurately track the consignments from the source to the market.
- Governments: Voter fraud is a major concern in almost every part of the world using a traditional voting process, which involves the local or central authority counting the final tally. The problem arises in case of corrupt governments where problems of fraud are regularly seen to deny voters of the actual results.
Blockchain implementation thus becomes a crucial technology to implement. By using it, people can vote anonymously, and the votes can be counted with more accuracy. The problem of multiple unauthorized votes can thus be eliminated because of the decentralized nature of blockchain. A good example is MiVote, a token-based platform which is being increasingly used for voting in different parts of the world.
Blockchain technology can also be used for digital asset registries, enabling quicker tax payments and a lower prevalence of tax fraud.
Where Are We In The Progression of Seeing Blockchain Being Adopted by Mainstream?
Ever since blockchain technology was first introduced in 2008 by Satoshi Nakamoto and made it available to the public, it has been actively tested and researched for value transfer. Because of the essence of blockchain technology which includes the ability to record critical information in a network in a truly secure way, it is being increasingly used to providing answers for the problem of ensuring digital trust,
As of 2019, the benefits brought by blockchain technology, namely security and efficiency, are being implemented in various public sector and private sector industries and organizations. This also explains the sudden rise in blockchain implementation by a number of different nations, currently standing at more than 12.
Thus, blockchain technology is starting to get implemented in the world over, even though it is still in its fledgling stage. Because the technology is still comparatively new, the current applications are not very mature and require trials and testing before finally being operational at the highest level.
Similarities Between the Blockchain and The Dotcom era
Experts and Financial analysts around the world have claimed Bitcoin to be a financial bubble, attracting similarities between it and the Dotcom bubble in the past. While the warning signs seen in the “Bitcoin bubble” is very similar to the dotcom bubble, the cryptocurrency space is not so redundant and is not expected to follow the same path.
In spite of this, the current leading projects in the cryptocurrency market, namely Bitcoin, Ethereum, Ripple and the lot can easily be likened to the Amazon, eBay and Priceline during the early days of the dotcom bubble.
As far as blockchain, the underlying technology is concerned, the intrinsic value has increased as more and more usecases have been prepared. A major takeaway from the dotcom bubble era is the handful of organizations with an underlying product or service, which stood the test of time. When it comes to Bitcoin, we can see that the astronomically high growth levels experienced in 2017 were far from sustainable.
With the latest advancements and the technology trend the world is experiencing, blockchain is poised to take over the world. Thus, among all the digital innovations expected to take charge of the world in the future, blockchain is considered the most likely to be implemented in far greater degrees when it comes to interacting with the physical world, communicating with institutions and businesses, blockchain can thus be implemented in solutions offered for tackling a number of societal and economic challenges existing in the world.